Aviva cull: Insurance giant cuts 950 jobs in cost saving carnage
Published 19/10/2011 | 10:29
INSURANCE giant Aviva is to halve its workforce in Ireland over the next two-and-a-half years, it has been confirmed.
The massive cost-saving exercise will see 950 redundancies from the Irish division of the company and its European business.
The job losses, billed as necessary to make "a stronger, leaner business", are expected to take effect from next March.
Igal Mayer, chief executive of Aviva Europe, said its costs in Ireland have to be reduced to protect the long-term future of the company.
"In Ireland, we must improve our competitiveness to ensure we continue to provide customers with attractive products, good value and excellent service," he said.
"We're fully committed to keeping customer-facing roles in Ireland and to minimising the impact on our employees.
Staff at Aviva centres in Dublin, Galway and Cork were briefed on the level of redundancies at a series of mid-morning meetings.
Union leaders from Unite are to open talks on the plan, confirmed by management after months of rumour and speculation that Aviva was planning a huge restructuring.
Aviva said the job losses were agreed in a proposal to merge the Aviva Ireland division with Aviva UK to form a new UK and Ireland region and become the most competitive insurance provider in Ireland.
In the announcement, the company said there is a pressing need to ensure the Irish cost base is at the head of the market to secure its long-term success.
Mr Mayer said: "We appreciate that there will be a period of uncertainty for our people over the next few months as the proposals are explored further, and we'll make every effort to support them during the consultation period and beyond.
"The proposed changes to our regional operations will deliver a stronger, leaner business, at the heart of which is a firm focus on meeting our customers' needs."
The redundancies are expected to involve 770 from Aviva Ireland and 180 roles from Aviva Europe based in Ireland.
Aviva Ireland employs 1,770 people in Dublin, Cork and Galway and has built up a customer base of 1.3 million people.
Redundancies are expected to be enforced in the next six months.
Management described Ireland as one of its 12 priority markets and said they will examine the possibility of opening new centres of business excellence in Ireland to serve customers in the UK with the hope that this might save about 200 jobs.
Aviva operates in 13 countries across Europe, including the UK, providing life, general and health insurance products to more than 32 million customers.
Senior union figures, who have battled with management for months to get clear information on company plans, said: "It's as bad as it could have been - perhaps even worse than anybody anticipated."
Unite regional officer Brian Gallagher summed up the mood among shocked staff: "The axe has fallen harder and sharper than the worst fears of staff.
"They are stunned and scared by what they have been told."
Trade union leaders were briefed on the plan by management yesterday evening. They said they have been given a commitment that consultations over redundancies and job transfers can be held for as long as is necessary.
Mr Gallagher said Unite will scrutinise the plan and fight to keep high-level positions in Ireland.
"The company remains immensely profitable on both a local and a global scale. The workers that have made it so cannot be treated with disdain," he said.
"The idea that Ireland is to be subsumed as part of the UK operation is something which we will fight against as this has serious implications for the most skilled positions and expertise within the Irish employee base."
He added: "Jobs will be lost but we will seek that as many as possible of these should be on fair voluntary redundancy terms, and that the overall number lost should be as few as possible.
"The process of this review has been unnecessarily hard on staff. Communication was poor and the key decisions were clearly taken on a multinational basis from London, without due consideration of the impact the uncertainty has had on the workforce and on the reputation of the business in Ireland."
Unite will hold talks with staff in Dublin today, Galway tomorrow, Cork on Friday and representatives of the 26 Aviva branches next Monday in Portlaoise.